Comms Dealer

One of the most important aspects of the BT-Ofcom deal to legally separate Openreach will be new insights into Openreach's accounts and the extent of its financial contribution to BT's overall Group figures, believes Adept Telecom CEO Ian Fishwick (pictured).

"The key issue is that Openreach never had its own set of accounts because it wasn't a separate legal entity," stated Fishwick.

"Now there will be a clear set of financial results that show the profitability and cashflow generated by Openreach.

"In the last half year it was estimated that Openreach generated about 60% of all of BT's cash. This is important because many in the industry want to understand whether Openreach's cash was being used to upgrade UK infrastructure or pay for sports rights for events such as The Champion's League."

Responding to news that Ofcom and BT have got their heads together and come up with a deal to nudge Openreach into becoming a limited company, the Federation of Communication Services (FCS) has strongly emphasised the need to ensure that the newly constituted Openreach Board reflects the aspirations of all Openreach stakeholders and customers.

"We therefore call upon Openreach, Ofcom and Government to take the next step to create a truly inclusive governance structure and arrangements to allow all industry stakeholder constituencies to be part of an inclusive and equitable investment decision making process," stated FCS CEO Chris Pateman (pictured) .

"FCS is ready to play our part in this proposed governance structure to ensure the development of effective competition and quality networks for the benefit of all customers and stakeholders."

According to Pateman, Openreach is not ‘separate' in any 'meaningful sense' of the word. "BT is still the sole owner and still the sole source of cash," he added.

But the real problem, believes Pateman, is the influence of legacy BT corporate culture. "Openreach has made progress under CEO Clive Selley's leadership," he added. "Even the Ethernet guys are starting to see improvements. But progress may have been achieved much faster if Openreach had not been held back by having to drag through the leaden slough of BT 'corporatethink'. This new ‘legal separation' does little to address that corporate drag."

BT's strong hand in shaping the look and feel of Openreach's ‘independent' Board did not go unnoticed by Pateman. Nor, once the Board was in place, did the timing of the Ofcom-Openreach deal.

"I am not aware that any industry stakeholders were consulted as part of this process," he added.

"But it is a Board with the operational responsibility for the management of Openreach's business. This is a good thing, and it gives us hope that quality of service and the value of Openreach's engineering workforce will be properly emphasised in the years to come. 

"It is not a Board in the sense of being able to raise money from anybody but BT, and dictated by BT. This we regard as a systematic weakness in the Board's ability to truly plan and behave like the long-term steady pay-back player the industry needs."

Pateman is also scratching his head over the strong arguments put forward by Ofcom relating to the difficulties posed by pension schemes in the context of structurally separating Openreach from BT.

But as part of the legal separation announced today BT is to TUPE 32,000 employees across to Openreach, which brings into question the validity of Ofcom's previous posturing on pension matters, and suggests that Ofcom did not have a grasp on the reasoning it put forward.

"This is interesting since one of Ofcom's main objections to forcing full structural separation was around the risks to the pension scheme," added Pateman. 

"We and other industry stakeholders have always argued that this was specious nonsense. So why all the delay and prevarication?

"We remain convinced that - as both Ofcom and the DCMS Select Committee independently concluded - the only sustainable and truly customer responsive Openreach is an Openreach which is fully master of its own destiny, structured and managed as a utility company and completely structurally separate from BT. Nonetheless, we are where we are."

BT and Ofcom have reached agreement on a long-term regulatory settlement that will see Openreach become a distinct, legally separate company with its own Board within the BT Group. The agreement is based upon voluntary commitments submitted by BT that the regulator has said meet its competition concerns.

Once the agreement is implemented around 32,000 employees will transfer to the new Openreach Limited following TUPE consultation, and once pension arrangements are in place.

Openreach Limited will have its own branding, which will not feature the BT logo.

The Openreach CEO will report to the Openreach Chairman with accountability to the BT Group Chief Executive with regards to certain legal and fiduciary duties that are consistent with BT's responsibilities as a listed company.

Gavin Patterson, BT Chief Executive, said: "I believe this agreement will serve the long-term interests of millions of UK households, businesses and service providers that rely on our infrastructure. It will also end a period of uncertainty for our people and support further investment in the UK's digital infrastructure.

"This has been a long and challenging review where we have been balancing a number of competing interests. We have listened to criticism of our business and as a result are willing to make fundamental changes to the way Openreach will work in the future."

The transfer of around 32,000 employees, under TUPE regulations, will be one of the largest such transfers in UK corporate history. It will take place once the agreement has been implemented and pension arrangements are in place for these employees. Under the agreement, Openreach will manage and operate its assets and trading but ownership of those assets and trading will remain with BT.

The agreement builds on changes that BT has already made to the governance of Openreach in recent months. These include the creation of an Openreach Board with a majority of independent members.

This Board will set Openreach's medium term and annual operating plans and determine which technologies are deployed, within a strategic and financial framework defined by BT. Openreach will be free to explore alternative co-investment models in private with third parties.

Vaioni Wholesale's link-up with Intelisys Global has brought immediate results by enabling sales partners to extend the initial connectivity conversation with customers to encompass, for example, higher value elements such as security.

The deal gives Intelisys Global's sales partners a route to Vaioni's range of carriers, access technologies, on-net or off-net connectivity and pricing options, along with its portfolio of network, voice and data centre solutions.

"The Intelisys Global technology services distributor model works well for Vaioni and, as a UK-based company, we see the relationship as an important enabler in supporting our international expansion," said Vaioni's MD Sachin Vaish.

"Engaging with Intelisys Global makes smart sense for Vaioni as we can work closely with the sales partners who act as agents to help develop added value for their customers," stated Vaish.

Intelisys Global MD Stephen Hackett added: "We're already starting to see how our sales partners can benefit from engaging with Vaioni Wholesale.

"We are also working alongside Vaioni to build out its EMEA market proposition and investigate further international opportunities."

Cradlepoint has secured $89m in series C funding led by TCV.

The growth-stage investment will fuel Cradlepoint's product initiatives in SDN, 5G wireless broadband and enterprise IoT.

Ted Coons, General Partner at TCV, and Doug Gilstrap, Venture Partner at TCV, have joined the cloud-based network provider's board of directors.

Cradlepoint has over 15,000 customers and 1.4 million units deployed worldwide, and has achieved over 40% compound aggregate growth rate (CAGR) for the last three years.

The firm provides 4G LTE network solutions for enterprises, governments and mobile operators. Its customer base includes 50% of Fortune 100, 75% of the world's top retailers, and 25 of the largest US cities.

"Cradlepoint has established a strong foundation in cloud-managed 4G LTE network solutions," said George Mulhern, CEO of Cradlepoint.

"The investment by TCV and its experience in guiding disruptive companies will allow us to build on this foundation to capitalise on the opportunity in front of us as digital transformation drives WAN transformation.

"SDN, 4G/5G wireless broadband, mobile networking and IoT technologies will all play a pivotal role in the new connected enterprise, and we are well-positioned to lead the way."

Digital transformation is accelerating cloud, mobile and IoT adoption. According to a report by IDC, the burgeoning market for SDN in the WAN (SD-WAN) is projected to reach $12.5 billion by 2020, spurred on by the need for more agile, automated and available networks and a direct result of digital transformation.

"By 2020, the number of people, vehicles, and things connected to the enterprise network will start to dwarf fixed branch sites," stated Eric Hanselman, chief analyst at 451 Research.

"This dramatic shift in the volume and variety of connections will force the enterprise WAN to become more cloud-orchestrated, software-defined and wirelessly connected and has already started to usher in an entirely new network security model.

"With this investment by TCV, Cradlepoint now has the potential to become a major player in wide-area networking for the connected enterprise."

An ambitious programme of local loop unbundling (LLU) has seen Zen almost double the number of Ethernet-enabled PoPs in its network, having installed its 400th PoP in BT exchanges.

Jon Bauer, Zen's technical director for network and infrastructure, said: "Unbundling exchanges and migrating services on-net provides Zen with end-to-end control of the network.

"The advantage of having services delivered entirely using the Zen network is that we have more flexibility with our products, and our ability to detect and repair faults doesn't rely on third parties, making it significantly quicker. Thanks to the rollout, nearly 75% of our customers will now be on-net.

"It also means that we pay less money to other operators to use their networks, producing savings that we pass on to customers in the form of better products, more cost-effective solutions and continued investment in our award-winning service and technical support."

Jan du Plessis is to succeed Sir Mike Rake as Chairman of BT when he retires on November 1st having been in the job for ten years.

Prior to taking over the role Plessis will join the Board as a Non-Executive Director on June 1st.

He has been Chairman of Rio Tinto since 2009 and also held a number of other senior non-executive roles including a director and Chairman of SABMiller, and as director and Senior Independent Director of Marks & Spencer.

Previously he was Group Finance Director of Richemont and Chairman at British American Tobacco.

Rake said: "While clearly there are continuing challenges, the performance of the company remains on track. This gives me great confidence in its future and I wish Jan every success as he leads BT at this important time."

Plessis added: "This is an important time for the company and I look forward to working with Gavin and his team to help BT continue to support Britain's digital future."

Crawley-based Akixi's momentum and traction in the worldwide market shows no signs of slowing down according to MD Bart Delgado (pictured) who this month spilled the beans on his comprehensive 2017 growth and product development plans.

Delgado revealed his strategic and product roadmap against a backdrop of a strengthening overseas presence in Europe, USA and the Caribbean, having accumulated 2,000 active client sites globally.

The company's upward trajectory is also reflected in its partnership with Gamma, a link-up that has introduced Akixi to over 500 Horizon reseller sites.

Just as positive is the outcome of a partnership with Dubber which has seen strong results following the launch of a call recording plug-in feature (a cloud-based scalable call recording service).

This year Akixi is set to build on 2016's successes with the roll out of new features including web services API integration, a must-have for customers wanting to take more control and programme the provisioning of administrative tasks in the Akixi reporting service.

"Using this new feature will significantly reduce the amount of time customers spend on performing routine tasks such as provisioning telephony servers, partitions, devices, ACD agents and application users," explained Delgado. "Previously, these were only accessible via the administration section of the Akixi application."

Other developments to look out for this year, pointed out Delgado, include the launch of a new-look user interface; a new smartphone application for Android and Apple devices; and an increase in data storage options to 12 months (currently three months is guaranteed).

"Akixi will guarantee a minimum of six months data storage, offering greater data security and recovery for customers and end users," stated Delgado.

He is also working on enhanced group reporting that combines inbound and outbound traffic per group, along with additional features for the 'hunt group list' that will display calls to and from all group members and calculate their call statistics.

This feature will also be added to large multi-site deployments and display call statistics for custom super-groups.

Continuing the reporting theme, Akixi is gearing up to introduce reports that can be grouped by both BroadWorks GroupID and BroadWorks department.

"Adding this feature will provide additional information for customers across all of their Akixi reports, and enable users to easily manage, sort and filter extensions," explained Delgado.

Akixi began its commercial life in 2008 and has evolved into an award winning provider of hosted call management and call centre reporting services.

Last year the company scooped the Comms National Award for 'Best Call Management Solution 2016', and was a finalist in the Comms Business 'Independent Software Vendor 2016' category, and a finalist in the Gatwick Diamond Business Award for 'International Business of the Year 2016'.

A streamlined range of O2 and Vodafone wholesale mobile tariffs introduced by Nimans have proved popular, dropping the price by as much as 25% on selected plans.

"Last quarter we introduced our new simplified mobile tariffs which are based on a smaller number of single user offerings with unlimited minutes, voicemail and text and competitive priced data bolt-ons at a fixed wholesale cost," said Mark Curtis-Wood, Head of Network Services.

"The price you see is the price you pay. These tariffs are available on 30 days notice contracts enabling you to run co-terminus contracts and be more flexible.

"As one of the first O2 Wholesale partners to move from DISE to ABS Nimans is able to be more flexible with the commercial offerings available to our resellers, therefore we have refreshed our range of packages available."

With its Q4 results, Tech Data closed the year off in a good position in Europe, even before adding the Avnet TS business.

While currency headwinds resulted in flat reported revenue of $4.8bn, constant currency sales were up 11% in the fourth quarter, across multiple categories including notebooks and mobility.

Total fourth quarter net sales were $7.4bn, a decrease of 1% compared to the prior-year quarter. On a constant currency basis, net sales increased 2%.

European net sales were 64% of worldwide net sales, a number which is likely to fall after the Avnet TS business joins, making Tech Data a less Europe-dominated operation.

European operating income was $66.7m, or 1.41% of net sales, compared to $75.1m, or 1.57% of net sales in the prior-year quarter.

For the full year total net sales were $26.2bn, a decrease of 1% compared to the prior year, but on a constant currency basis, net sales increased approximately 1%.

Europe: Net sales were $15.8bn (60% of worldwide net sales), a decrease of 1% compared to the prior-year. On a constant currency basis, net sales increased approximately 2%.

Inside the numbers, Tech Data has been doing well selling Apple's products, now up to 20% of revenue on the back of introducing the consumer lines TV and Watch. Apple is now the company's biggest vendor, ahead of even the two halves of HP.

"Our strong Q4 results capped a historic year for Tech Data - a fiscal year of significant strategic progress and strong financial performance," said CEO Bob Dutkowsky.

"In fiscal 2017 we achieved all of our primary financial objectives: we gained share in key geographies, gained share in select product categories and with key vendors. We also improved nonGAAP operating income; and delivered our highest non-GAAP earnings per share in the history of our company.

"Tech Data accomplished all of this despite a dynamic global geopolitical and economic environment, a significant vendor consolidation, and an evolving IT consumption model. On top of this, we recapitalised the company and entered into the largest, most transformative acquisition in our company's history."